ERP software, Risk Management

10 Risks to Consider Before Buying a Manufacturing ERP Software

By | 6 Min Read

Last Updated

“Reducing ERP implementation risk is critical to set your manufacturing operations for a successful outcome. Overcome these risks to achieve the desired outcome…”

Manufacturing ERP Software

 

In this era of technology, we have definitely come a long way. We can do so many things that we earlier thought were impossible. Earlier running a business would require you to do everything manually, now you have ERP software solutions to assist at every stage. It just makes every business process a whole lot easier. It provides an all-in-one solution for all the challenges that can exist within your process. Same is the case with a manufacturing ERP software. It assists in bringing every information on a single database, making it easier to streamline manufacturing operations.

However, investing in a manufacturing ERP software without taking care of these ERP risks and challenges will not prove useful.

Manufacturing ERP Software: Things to Consider Before Buying

Let’s have a look at what are the ERP implementation risks you should consider before buying an ERP software for manufacturing industry.

  1. Setting Wrong Expectations

Of course you are going to select an ERP software based on your current business requirements, but does it provide the option of further upgrade? There is a huge risk in adapting a software that is robust and does not take into account your wants and needs like mobile compatibility, customer relationship management or supply chain management. As the business grows, your requirements are also going to change. Therefore, selecting an ERP for manufacturing industry that provides flexible manufacturing ERP modules according to what the industry wants is important.

  1. Neglecting Data Security Concerns

An ERP software that provides end-to-end security in essential in manufacturing industry. An ERP solution with advanced security features would monitor your external transactions, block unrecognised access and allow you to regularly audit the entire system for intruders. Always look for an ERP software for manufacturing that keeps security as a priority. A trusted ERP software gives selective access rights, preventing intruders from catching hold of your confidential information. A good ERP software should also provide regular security updates to increase protection.

  1. Choosing the Wrong Vendor

Choosing a vendor who is known and has a reputation in the manufacturing industry is good, but many of the big manufacturers are rigid in their thought processes and are not willing to change their technology according to the rapidly growing market. You should be looking at genuine references and the vendor’s previous records as well. Go with what your gut says, don’t hesitate to back off when you find something fishy. You also need to make sure that your vendor provides a legitimate maintenance plan. After setting up a manufacturing ERP system, you also need to upgrade it consistently.

  1. Ignoring Financial Risks

Different manufacturing companies have different budget to implement a software in their businesses. It is important that you consider your budget for buying an ERP manufacturing software. Take into consideration your implementation cost as well. Be very clear about your expectations, so that you do not exceed your budget, hampering the cost and profit of the company.

  1. Non-acceptance by End-Users

People who are working manually since years find it difficult to embrace an ERP system. Generally, your oldest employees would resist this change as they are not accustomed to this technology. If a lot of people are resistant to change, it might be a risky decision to implement the software without involving them in the decision-making process. Listen to your employees’ pain points and look for an ERP software for manufacturing company which addresses their needs. You can also make them understand the benefits of a manufacturing ERP software by providing online demos and training.

  1. Not Checking for Integrations

A manufacturing ERP software can only help you to a certain extent. You cannot completely rely on just the software to make crucial business decisions. Manufacturing process software can guide you in several ways, but in the end it is just a tech aid. For getting the most out of an ERP for manufacturing industry, you have to check for its integration with existing systems like HRMS, inventory management and accounting software.

  1. Technical Risks

Even after conducting proper risk assessments, there can be technical issues associated with a manufacturing ERP software. Technical risks cannot be resolved by you or your general staff. It requires special training and only those who are trained in manufacturing ERP software can resolve those issues. These risks can be solved by either the vendor, or you can also hire a trained individual to maintain the software for you.

  1. Choosing the Wrong Type of Software

Choosing the type of manufacturing ERP software that you need is a crucial decision to make. A cloud-based software would require a smooth internet connection which can also help people work remotely. Whereas, an on-premises ERP solutions would need a team to maintain in-house servers which would cost you more. It totally depends on your business needs. If you want more security and are ready to pay a heavy price for it, on premise ERP in manufacturing industry is the way to go.

  1. Lack of Customization

When you purchase a software for ERP manufacturing process flow, it is likely to work as per your specifications. However, challenges in manufacturing process may arise later when you try to customize your ERP solution and start getting add-ons. If you choose incompatible add-ons that does not work with existing systems, you will end up putting your ERP implementation at risk. It’s advisable to refer the vendor for any modifications you require and ensure that you are adequately secured against known vulnerabilities.

  1. Inadequate Training of End-Users

Training and reskilling your employees to use manufacturing ERP software seamlessly is important. Only by training the end users, your organization can ensure higher performance and manufacturing quality. Give your employees the skills they need to use different ERP modules effectively.

It is important to know about the risks involved beforehand, rather paying a price for it later. As they say, prevention is better than cure. List and analyse the risks involved before selecting a manufacturing ERP software for a smooth implementation and life cycle of your manufacturing ERP software. You can have a look at those manufacturing ERP software which are completely safe and secure to use for your business.

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